IN THE INDUSTRIAL RELATIONS COURT OF MALAWI
MATTER NO. IRC 34 OF 2004
MWAFULIRWA . APPLICANT
MANICA MALAWI LIMITED ... ..RESPONDENT
CORAM: R. Zibelu Banda (Ms): Deputy Chairperson
Gulumba: Of Counsel for the respondent
Ngalauka (Ms.): Court Clerk
Dismissal-Justification for Dismissal- Reason-Operational Requirements- Redundancy- Procedure for Redundancy-Consultation.
The applicant was employed on 2 December 2002 as National Network Supervisor in the IT Department. He was dismissed on 21 January 2004. The reason for dismissal was redundancy. The IT Department was going through technological reforms and personnel restructuring. New computer packages were being introduced and the applicant was not capable of installing, operating and maintaining those new packages. The respondent intended to acquire services of a capable person to install and manage the new soft ware.
Since the IT Department was small, the respondent decided to declare the applicants position redundant in order to establish the position of IT Manager that would incorporate the applicants duties. The requirements for IT Manager were more advanced than those of National Network Supervisor held by the applicant. He challenged the dismissal because he thought he qualified for the position of IT Manager. He further said he was not consulted prior to dismissal. The respondent maintained that the dismissal was fair as the applicant was consulted and paid all his terminal benefits.
The Court was called upon to determine whether the dismissal was unfair. A dismissal is unfair if there was no valid reason for the dismissal and where in the case of redundancy the applicant or his representative was not consulted.
Section 31 of the Constitution guarantees every person the right to fair labour practices which entail the right to know the reason for dismissal as provided in section 43 of the Constitution. The burden of proving the reason for dismissal is on the employer, see section 61 of the Act and Earl V Slater & Wheeler (Airlyne) Ltd  1WLR 51at 55, where it was held that:
It is for the employer to show what was the principal or only reason for dismissal . and that it was a potentially valid reason . If the employer fails to discharge this burden, the tribunal must find that the dismissal was unfair.
The Court heard that the applicant was operating in a two-person department comprising himself and his junior based in Lilongwe. The applicant headed that department. There was an operational requirement to introduce new technology to the department. The applicant was aware of this development. In fact the applicant was sent to South Africa for a short course to prepare himself for the new package. However, the respondent observed somehow that the applicant was not suitable to manage the new package. They therefore decided to employ a more a senior individual with more relevant qualifications to install and manage the new software.
The respondent had also noticed some inadequacies in the applicants performance. As a result of the inadequacies the respondent engaged a private consultant to perform the applicants duties at a fee. The respondent decided to employ an individual who was capable of handling the IT Department without the respondent incurring expenses by engaging external consultants.
An assessment of the respondents pieces of evidence show that indeed they introduced a new package that required expertise for its installation and maintenance; the applicant was not capable of heading the department even before the new package was introduced; they required a more capable person with both technical and managerial skills to head the department; the IT Department was small, comprising two staff members and the introduction of a new position of IT Manager to head the department, meant the applicants position had to be declared redundant as his responsibilities were incorporated into the position of IT Manager.
The applicant averred that he was capable of performing his duties as National Network Supervisor. He admitted that during interviews he had informed the panel that there were certain packages he was not conversant with. They employed him all the same because he was suited for that job. He denied any knowledge of work done by an external consultant. He was never informed of any shortcomings in his department that required services of an external consultant. In any case he qualified for the position of IT Manager. To this effect he produced two documents to show that the respondent on two occasions referred to him as IT Manager. All in all, the applicant told Court that he was not consulted about the redundancy. He maintained that the redundancy was a sham to cover up the real reason for dismissal.
The applicants pieces of evidence show that he was employed as National Network Supervisor; it was a junior position as compared to the position of IT Manager; he was heading the IT Department but there were certain packages he was not conversant with; he did not qualify in terms of relevant academic qualifications and necessary experience for the new position of IT Manager; he was never at any time promoted either expressly or impliedly to position of IT Manager; he was aware of new packages coming in and he had acquired the requisite training to operate them; and he was not aware of any of his shortcomings in the performance of his work as he was not informed.
On the facts the Court finds that the respondent proved on a balance of probabilities that operational requirements of their undertaking in this case acquisition of new technology and restructuring of the IT Department made it necessary to declare the applicant redundant. The applicant did not have relevant qualifications and necessary experience to deal with some technology necessary for the respondents operations. Further, the restructuring of the IT Department by introducing the position of IT Manager to operate and head the department necessitated declaring redundant the position of National Network Supervisor. The Court finds that the respondent had a prima facie reason for declaring the applicant redundant.
Having found that the respondent had a valid reason to dismiss the applicant, the Court must find whether the process of dismissal conformed to the law. Apart from providing a reason, the process of hearing the other side through consultation or otherwise is an essential component in dismissal cases.
It was thus put in the English Court of Appeal in Polkey V A E Dayton Services Ltd 3 All ER 974 at 983-984; per Lord Bridge of Harwich:
An employer having prima facie grounds to dismiss will in the great majority of cases not act reasonably in treating the reason as sufficient reason for dismissal unless and until he has taken the steps, conveniently classified in most of the authorities as procedural, which are necessary in the circumstances of the case to justify that course of action.
The Employment Act does not provide procedure for redundancy. To fill the lacuna the Court has applied the procedure provided in the International Labour Organisation (ILO) Convention Number 158 that deals with Termination of Employment at the Initiative of the Employer to fill the lacuna. Articles 13 and 14 of the Convention provide that before dismissal on ground of redundancy the employer must inform and consult relevant institutions like workers union, government department and the employee(s) to be declared redundant. The information must among others contain the criteria used to select the employee (s) and the period over which the redundancy will be effected.
The requirement to consult is crucial in all redundancy cases because the consultation process brings out information pertaining to why the applicant and not someone else should be declared redundant; who made the decision; what information did he or they base their decision on; what period would be required to carry out the redundancy and whether there is any way of averting dismissal. It was thus held in Freud V Bentall Ltd  IRLR 443 EAT that:
Consultation is one of the foundation stones of modern industrial relations practice. In the particular sphere of redundancy, good industrial relations practice in the ordinary case requires consultation with the redundant employee so that the employer may find out whether the needs of the business can be met in some other way than by dismissal and, if not, what other steps the employer can take to ameliorate the blow to the employee.
In the instant case the respondent did not show the Court that they consulted the applicant. The fact that the applicant knew about a new package that was to be introduced was not consultation regarding his dismissal. The applicant was sent for training in preparation for the new package, this step can hardly be said to have been aimed at preparing the applicant for redundancy. It sent a contrary message. Why would the respondent send an employee for specialized training only to dismiss him some months later not for misconduct but redundancy?
The respondent showed Court that the applicant was not capable of performing certain operations and the respondent incurred expenses getting an external consultant. This was the kind of information which should have been given to the applicant as one of the grounds why operational requirements of the company necessitated employing a capable officer in order to reduce expenses.
Further, the respondent showed that the restructuring of the IT Department required a more senior officer and yet the respondent did not inform the applicant before dismissal of that requirement. The respondent should have laid the plans before the applicant including the requirements for the new position. Let him apply and be assessed along side the other job applicants. In that way the applicant could have been given an equal chance after all he was heading the department until this time. These are just examples of what consultation in this case would have covered.
It is expected that matters of restructuring and technology do not come abruptly. These are issues which require planning and involvement of costs/expenses. This is why there is a requirement to inform employees the period over which the process would take place. It was therefore surprising that the applicant who was heading the department in issue was told of the redundancy on the same day that he was dismissed and in a letter dismissing him. He was not even given an option to serve a proper notice and do a proper hand over. It was like the applicant had committed some grave offence and the respondent could not face the prospect of keeping him another day. This was unlike redundancy and more like misconduct case involving theft or some like offence. There was no explanation why the applicant had to be dismissed on redundancy ground without consultation.
The Court finds that the reason for dismissing the applicant was valid. However, the procedure for declaring the applicant redundant was flawed in law. The right of the applicant to fair labour practice under section 31 of the Constitution was violated. The dismissal was unfair on technicality.
Assessment of Remedies
The applicant is entitled to a remedy under section 63 of the Employment Act. The matter shall be set down on a date to be fixed for assessment of an appropriate remedy.
- Pronounced in Open Court this 26th day of April 2004 at LIMBE.
R. Zibelu Banda (Ms.)